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If there is one thing I don’t understand it is the military and the unique financial challenges facing active military personnel and veterans. Lucille Rosetti has provided another post helping fill the gaps in my experience. She has provided several valuable resource links helping veterans plan their future. She is part of the Wealth Legacy Institute, has graced the digital pages of this blog before and elsewhere on the web. Enjoy
Your New Mission: Plan For the Future
by: Lucille Rosetti
As a U.S. veteran you have served your country, but now more than ever it’s time to serve yourself and your family. As you get older this means making a plan to ensure your finances are in order. Avoiding this can harm you financially and could leave your family struggling later down the road. Here are some practical tips to help you complete your most important mission yet: taking care of yourself after you retire.
Utilize VA Loans to Refinance or Buy
Even if you don’t have perfect credit you still have to have a place to live. As a veteran, you may be eligible for a lower-interest VA loan, which can save you a significant chunk of money each month. If you qualify, a VA purchase loan doesn’t require a down payment or private mortgage insurance like a conventional or FHA loan. Refinancing can also help you save money by lowering your interest rate if you already own your property. Keep in mind, however, that the property appraisal must be higher than the selling price.
Discuss Your End-of-Life Wishes
Thinking about your own death isn’t pleasant, but making plans in advance is important. If you haven’t already, one of the first things you should do is have a conversation with your family about your final wishes. Do you want to be buried or cremated? Do you want a formal funeral service or a casual end-of-life celebration? While it will ultimately bring everyone peace of mind and allow you to begin making financial plans for final arrangements, know that it will still be a difficult conversation for you and your loved ones. Approach the subject with sensitivity, and be ready to have multiple discussions with anyone who can only talk about a few details at a time.
Supplement Your VA Burial Benefits
In order to offer some support to your loved ones during what will already be a traumatic time, you also need to make a plan about how to pay for your final arrangements. Military.com explains that the VA offers a small stipend to help your family pay for your funeral. At most, this is $2,000, a sum that only applies if your death was directly related to service. A funeral can easily cost $8,000 or more. Consider supplementing your VA burial benefits with a funeral insurance policy, which can also provide your family with a small injection of cash to help cover outstanding debts. Before you decide how much coverage you need you’ll need to know the kinds of arrangements you would like and how much money should be left over for other needs.
You Can Still Save Money
When you enrolled in the Armed Forces you likely had the opportunity to open a Thrift Savings Plan. Even if you had matching contributions this might not be enough. This is especially true if you had to make withdrawals to cover your living expenses as you transitioned from military to civilian life. If you are still working you have the option to add funds to an IRA up until you are 70. There are special rules, however, and if your only income is from an annuity, pension, or disability, you won’t be allowed to contribute to an IRA. There is nothing stopping you from putting money into a high-yield savings account or, under the guidance of a respected financial advisor, a low-risk investment vehicle.
VA Medical Benefits Offer Broader Coverage Than Medicare
You’ll become eligible for Medicare when you turn 65, but it may not be enough. If you have significant health problems or are considered low-income VA medical benefits may be a better option. This coverage, which is explicitly set aside for veterans goes beyond Medicare benefits by providing dental care and long-term residential nursing home care. You may be eligible for lower co-payments and deductibles. Reach out to the VA by calling 877-222-8387 and ask for VA Form 10-10EZ. This is the Application for Health Benefits and is the first step in understanding what you may qualify for. You can also apply online at VA.gov.
Although you’re no longer on active duty, it’s still your duty to take care of yourself and to protect your family’s financial future. You can do this by paying close attention to your benefits. Some, such as a VA loan, can help you save money. Others, like VA funeral reimbursement, aren’t enough to cover your needs. Knowing what you have and what you don’t is the best way to make a plan that will allow you to defeat the enemy of time and live out your golden years without the weight of financial woes.
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